MasterCard International is targeting the mail-order and telephone-order industry with a new address-verification service introduced last week.
Address Information Management is designed to verify the legitimacy of any address in the country and to reduce the merchant's burden in investigating a suspicious transaction.
More than one third of all mail- and telephone-order purchases, which make up 10% of the New York-based association's overall sales volume, are shipped to an address other than the cardholder's billing address.
MasterCard's new service is linked to a data base that identifies high-risk addresses, such as prisons and check-cashing stores, or residences that have suspicious activity.
"If a residence had an unusual amount of traffic, it might signal some alarms," said Joel Lisker, senior vice president of MasterCard's security and risk management. "The service does not prevent the transaction from occurring, but it does allow the merchant to make an informed decision."
Address Information Management's data base includes information on more than 137 million consumers, 92 million households, more than nine million businesses in the United States, and high-risk addresses.
Reports of Fraud
In addition, merchants and acqirers also contribute to the data base by supplying a list of suspicious transaction based on their experiences over a five-clay period. Because fraudulent locations change quickly, the file is active only for a short time.
Information details, among other things, the number of transactions from one address, the purchase amounts, and the merchant product line.
Address Information Management will be available by midyear.